Toshiba falls sharply on the stock market after announcing large capital increase

Japan's technology conglomerate Toshiba fell sharply on the Tokyo Stock Exchange on the first trading leg, after announcing a multimillion-dollar capital increase to search liquidity in the face of financial difficulties.

Tokyo, November 20 (EFE) .- The Japanese technological conglomerate Toshiba fell sharply on the Tokyo Stock Exchange today in the first tranche of negotiations, after announcing a multi-million dollar capital increase to seek liquidity in the face of financial difficulties.

Toshiba shares lost more than 4 percent since opening and were trading at 280 yen (2.1 euros) / $ 2.8) at mid-session.

Investors reacted to the capital increase announced on Sunday by the company, which has decided to raise 600 billion yen (4,568). million euros / 5,537 million dollars) through the issuance of new shares on December 5.

With this measure, the company expects to obtain liquidity to face to the outstanding payment obligations of its US nuclear power subsidiary Westinghouse Electric, declared bankrupt in that country last March.

The operation "will allow remedy a negative consolidated balance sheet and prevent (the company) from quoting on the stock market, which constitute the most urgent challenges for Toshiba ", as explained in a statement.

The debts that the subsidiary carries have also forced Toshiba to divest itself of its branch of memory chips -the most profitable of its businesses-, whose sale it hopes to close before the end of the current fiscal year in March 2018.

In the current fiscal year, Toshiba expects to record a net negative equity of 750,000 million yen (5,710 million euros). euros / 6,696 million dollars), according to the company's earnings estimates, which do not include either the capital increase or the expected income from the sale of its branch of chips.

The financial difficulties arising from Westinghouse Electric led Toshiba to successively delay the presentation of its financial results, which caused the group Japanese was demoted to the second section of the Tokyo Stock Exchange last August.

In the event that it incurred negative net worth for the second consecutive year, the emblematic Japanese company would be disqualified from the Tokyo Stock Exchange.

In the past year, the multimillion dollar deficit of its US nuclear arm led Toshiba to register a heritage negative of 552,900 million yen (4,277 million euros / 5,023 million dollars).